Brazil vs. World: Salaries in Brazil 85% higher than US & Europe

The Brazil growth story is causing what was unimaginable a few years ago: the wages of workers in Brazil are higher than in European nations and the United States. According to consultancy firm Michael Page, the salaries can go up to 85% higher, with all appropriate currency conversions already included.

1. A senior electrical engineer in Brazil earns at least R$15,000 at large companies in Brazil, while in Spain he would earn R$8,000 and, if in Italy, he would earn R$9,000.

2. A sales manager earns about 80% more in Brazil (R$18,000) than in the United States (R$10,000 U.S.).

3. A legal consultant in Brazil (R$15,000) earns 25% more than in Italy (R$12,000)

4. A director of sales in Brazil earns at least R$28,000, about 14% more than a similar one in the UK (R$24,000).

5. Joao Nunes, a 30 year-old Portuguese, works at Michael Page and has been in Brazil for only three months. He earns 30% more in Brazil (it can reach 50% including bonuses) than in Europe, but says “the salary is higher, but the cost of living here is also much higher. Rents in Sao Paulo are two times more expensive than Portugal. Food, everything is more expensive. So our capacity to save capacity is shrinking.”

6. A recent engineering graduate in Brazil can start earning R$5,600 but his starting salary can reach up to R$8000, which in Spain is the salary of a senior engineer.

7. A director at marketing agency Azul, in Rio, says that this year overall salaries in his agency shot up 40% on average.

8. A Systems Analyst can earn up to R$20,000.

According to Michael Page, these wage differences are due to labor shortages in Brazil.

Our take on these news: the rise of wages is making Brazil uncompetitive, companies earnings are shrinking. The labor shortages pointed out by Michael Page are only part of the problem. The main issues are government costs and high taxation. An example: to hire a R$10,000/month professional, the employer must pay more than R$10,000/month in taxes and fees to the federal government (after all, who will pay for the bribery?). In other words, a R$10,000 a month professional costs the company more than R$20,000 a month. Talking about being uncompetitive…